Instead of cash handouts, the government should instead come up with a different mechanism to aid the needy rakyat.

Federation of Malaysian Consumers Association (Fomca) deputy president Mohd Yusof Abdul Rahman said this when commenting on Budget 2016 where the 1Malaysia People’s Aid (BR1M) scheme received an across-the-board increase of RM50.

The continuation of the BR1M, said Yusof, showed that the government preferred cash handouts.

“We recommend that BR1M be given in the form of food coupons and this will achieve certain objectives.

“If the government thinks that giving BR1M by way of cash is better, it’s okay.

“But for the long term, the government could think of a better mechanism, maybe monthly coupons for food,” he told Malaysiakini .

Prime Minister Najib Abdul Razak yesterday announced that 2016 will see households with income under RM3,000 receiving RM1,000 under BR1M, while households with income of between RM3,000 and RM4,000 will receive RM800 each.

Singles aged above 21 with an income under RM2,000 will get RM400.

A new category was also created for households with income under RM1,000 under the E-kasih system where they will receive RM1,050 each.

Yusof also suggested that apart from additional goods being exempt from the Goods and Services Tax (GST), more services should also be exempt from the regime.

“There should be exemption for financial services. For example, those who use automated teller machines (ATM) should not be charged GST.

Prepaid rebate 'good move'

Yusof also believes that the zero-rated GST list should be expanded. “The current list is too short as there are many more essential goods.

“The government should expand the list to include other items,” he said.

Najib yesterday announced new items to be included to the zero-rated GST list.

Effective Jan 1, 2016, the list will include controlled medicines and food items like soybean-based milk and organic-based milk for infants and children as well as dhal, brown sugar, various nuts, lotus fruit water chestnuts, and dried kolok noodles.

Yusof lauded the government’s move for consumers to get rebates on mobile prepaid cards equivalent to the GST amount paid effective Jan 1, 2016 to Dec 31, 2016.

“It’s a good move. It is just that the mechanism on how the rebate is to be paid is not clear.

“But it’s a good move for a start,” he said.